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Fidelity Study: Despite Being Cost-Conscious, Many Self-Directed Investors Aren’t Making the Most of Their Brokerage Firm

In Fidelity Investments®’ second Brokerage Value Study, 1,000 U.S. self-directed investors say they chose their primary brokerage firm for table stake reasons such as “trusted brand/financial strength” (38 percent) and a “wide selection of investments” (34 percent). However, they also cite more specific value components, such as “low commissions and fees” (37 percent) and “high quality trade executions” (31 percent). […]Another critical area investors should clearly understand is how their brokerage firm charges for bond trades. While some firms have “hidden” markup fees for bonds, others provide transparency by charging only an up-front fee. A Corporate Insight study found online bond prices from brokers who bundled their markups and fees into a single online bond price were on average $13.65 higher per bond than Fidelity, which charges a fully disclosed online bond trading fee of $1 per bond and zero concession for U.S. Treasury bonds.